Speaker 1: Bloomberg Audio Studios, Podcasts, radio news.
Speaker 2: This is the Bloomberg Surveillance Podcast. I'm Jonathan Ferrow, along
Speaker 2: with Lisa Bromwitz and Amrie Hordern. Join us each day
Speaker 2: for insight from the best in markets, economics, and geopolitics
Speaker 2: from our global headquarters in New York City. We are
Speaker 2: live on Bloomberg Television weekday mornings from six to nine
Speaker 2: am Eastern. Subscribe to the podcast on Apple, Spotify or
Speaker 2: anywhere else you listen, and as always on the Bloomberg
Speaker 2: Terminal and the Bloomberg Business app. Binky Shadow of Deutsche
Speaker 2: Bank writing, our base case remains for a significant rally
Speaker 2: on a credible relent on trade policies, with a target
Speaker 2: of sixty one to fifty by year end. Thinking, good morning,
Speaker 2: good to see us, sir. Sixty one to fifty the
Speaker 2: new target. It's down from seven K. Let's deal with
Speaker 2: the language. There a credible relent on trade policy? What
Speaker 2: does that mean to you?
Speaker 3: So you know, it's meant to capture an idea, and
Speaker 3: it's about convincing the market that you're sort of done
Speaker 3: with the trade policy issue, that there is a huge
Speaker 3: amount of uncertainty about the different ways that that can
Speaker 3: be done. And at the end of the day, given
Speaker 3: where we are, you know, I expect it will be
Speaker 3: kind of mushy. I don't have a better word than that.
Speaker 3: So some trade deals, perhaps some lowering the big question
Speaker 3: mark about ten you know, the ten percent uniform tariff,
Speaker 3: because by the uniform tariff that we have put on ourselves,
Speaker 3: we've weren't us growth more than we are hurting anyone else.
Speaker 2: At least to ask the question where the pressure would
Speaker 2: come from. Where do you see the pressure coming from?
Speaker 2: What drives that credible relent?
Speaker 4: I think at the end of the day, it's the
Speaker 4: same thing.
Speaker 3: So when you think about presidential elections, you know, we've
Speaker 3: all heard it's about the economy.
Speaker 4: Stupid in the sense that other things.
Speaker 3: Matter, but it's mostly about the economy. And so I
Speaker 3: would argue it's presidential job approval ratings. And because you know,
Speaker 3: if you think about if the presidential election is about
Speaker 3: the economy, and then you ask people, you know, where
Speaker 3: do we ask people how do they feel about the economy?
Speaker 3: It's consumer confidence. So the typical pattern is new presidents
Speaker 3: start with the hefty sort of goodwill or a honeymoon
Speaker 3: period of high improver ratings. The honeymoon then tends to
Speaker 3: wear down, and the question is where do we land.
Speaker 4: We land at.
Speaker 3: Levels that are basically, you know, dictated by consumer confidence.
Speaker 3: I would argue happened the last two administrations, and so
Speaker 3: you know, we are.
Speaker 4: Midway in that process.
Speaker 3: We started up here, we've been coming down and the
Speaker 3: trajectory right now and I'm just remind that current consumer
Speaker 3: confidence levels, you know, suggests that you might get down
Speaker 3: to thirty percent.
Speaker 4: And so I think there will be a reaction long before.
Speaker 5: Yeah, there's some pretty negative soft data that have been
Speaker 5: coming out. You talk with us when you head is
Speaker 5: still a seventh thousand and reading seven thousand target on
Speaker 5: the S and P five hundred, saying it was a
Speaker 5: matter of time and if this uncertainty didn't get resolved,
Speaker 5: you would have to bring your forecast down, which is
Speaker 5: part of the reason why.
Speaker 6: You did bring your forecast down.
Speaker 5: Now there is a question of how much longer can
Speaker 5: this go on before you bring it down again, Before
Speaker 5: you cannot put the toothpaste back in the tube, you
Speaker 5: cannot put the gen back in the bottle. Pick your
Speaker 5: potential saying how much are you looking at that?
Speaker 4: Very much?
Speaker 3: I mean I think that, you know, the risk is
Speaker 3: that the relent that we were talking about comes basically
Speaker 3: too late and the noninearities of for session kick in.
Speaker 4: I think one has to be honest.
Speaker 3: Which is that it's just very difficult to gauge what
Speaker 3: the impact of the tariffs is going to be. And
Speaker 3: by that I mean I think they're clearly negative for
Speaker 3: US growth. They're very negative for US earnings. Precisely how
Speaker 3: much is the question? I mean, on a twelve month basis,
Speaker 3: you know, we calculate that the impact would be fifty
Speaker 3: six dollars p five hundred EPs. And just to put
Speaker 3: that number in perspective, you know, last year we had
Speaker 3: two d and fifty dollars of earning. So if you're
Speaker 3: talking about fifty six dollars hit, that's a very large number.
Speaker 3: It's a very large number by any standards. And so yes,
Speaker 3: the nonlinearities of recession can kick in and the relent
Speaker 3: might come too late. But you know, then you have
Speaker 3: to think about basically, Okay, so if you're going to
Speaker 3: go down, maybe we have a recession, you know, getting
Speaker 3: a recovery from a supply side recession is you know,
Speaker 3: doesn't fit a typical playbook. So it's something that will
Speaker 3: have to be you know, seen and work out.
Speaker 4: Basically in the.
Speaker 5: Sense that big tech is going to lead this charge.
Speaker 5: That is essentially what we have already seen from both
Speaker 5: Meta and Microsoft as well as Alphabet last week, that
Speaker 5: there's sort of a resurgence in faith in US tech
Speaker 5: that can bolster some of the pain that you might
Speaker 5: see elsewhere from the likes of McDonald.
Speaker 6: Or GM or some of the other companies that are
Speaker 6: more hit.
Speaker 3: Yeah, what I would say is, you know, earnings are
Speaker 3: basically saying they're hanging in right now, and earnings are fine.
Speaker 3: But again this is about you know, this about yesterday,
Speaker 3: not about tomorrow, and the question is what happens tomorrow.
Speaker 3: So you know, our take is that earning's growth for
Speaker 3: the first quarter currently, you know, looks like it's coming
Speaker 3: in around ten percent year and year. That could drop
Speaker 3: to basically zero in the second quarter that we are
Speaker 3: in and then basically turn negative on the baseline view
Speaker 3: that the get out on s tariffs all come into
Speaker 3: effect and stay. I mean, it's just you know, if
Speaker 3: you think about the numbers, it's just you know, horrendous.
Speaker 1: Think you talk about this relent, what's the level, what's
Speaker 1: the destination you think we're going to get to in
Speaker 1: a base case scenario.
Speaker 4: I don't know, it's the honest answer.
Speaker 3: I think it's all getting worked out dynamically, and so
Speaker 3: the circumstances and what happens.
Speaker 4: So it's data dependent to use a bad term.
Speaker 6: So do you think it's political?
Speaker 4: Question of yeah, I think it's political.
Speaker 1: So basically they have to November third of twenty twenty six.
Speaker 3: You know, the midterm elections start a lot earlier, and
Speaker 3: I would argue, you know, the clear and present danger
Speaker 3: is to approve ratings they have, you know, sort of
Speaker 3: predictable consequences on your ability to cover.
Speaker 4: And so we shall.
Speaker 2: See, Binky, we shall see. It's going to get an
Speaker 2: update from you. Thank you, sir, appreciate it. Binky Chant
Speaker 2: of the Deutsche Bank on the equity market, Brank under
Speaker 2: a stafer with a surround of table branc and morning's
Speaker 2: a little bit later this morning, we'll catch up with
Speaker 2: Binki Chanda, a Deutsche Bank and this is his call
Speaker 2: sixty one fifty on the SMP. He says that's going
Speaker 2: to be driven by a credible then on tariffs, and
Speaker 2: that will be shaped by damaged polls. Is this president
Speaker 2: driven by Poellink?
Speaker 4: No.
Speaker 7: I think he's driven by legacy. I think that's what
Speaker 7: drives everything with the White House right now. This is
Speaker 7: the second term. There will be no third term, despite
Speaker 7: the you know, the jokes about it.
Speaker 8: But he's been talking. Trump has been talking about.
Speaker 7: Tariffs and a restructured US economy since the nineteen eighties.
Speaker 7: This is it for him. This is a one chance
Speaker 7: to get this done. So the idea that there's going
Speaker 7: to be this massive pullback despite the pause and everything,
Speaker 7: I think Trump believes this in his heart.
Speaker 8: Maybe there is.
Speaker 7: Some economic data, some market data that comes in later
Speaker 7: and causes them to recalibrate.
Speaker 8: You know, certainly.
Speaker 7: Everybody's thought there was a Trump put. I think we
Speaker 7: miss priced the Trump put to a large extent. Maybe
Speaker 7: it's still there, but I think at the end of
Speaker 7: the day, they're thinking about legacy.
Speaker 4: Well.
Speaker 1: He basically said recently to The Atlantic that there's really
Speaker 1: no red line, no certain number that would pull him
Speaker 1: back and reverse policy. To your point, though, that he
Speaker 1: wants to see a global realignment. He talked about yesterday
Speaker 1: in this town hall. The fact that terrors are difficult
Speaker 1: to explain because he takes a maximus approach to then
Speaker 1: bring it down. Do you believe he wants a full
Speaker 1: global realignment with some of the figures he has now
Speaker 1: or he wants negotiated deals in terms?
Speaker 7: I think he wants negotiated deals to get to that endpoint.
Speaker 7: That endpoint being that restructured global economy, whatever that looks like.
Speaker 7: And I don't know that he necessarily has a clear
Speaker 7: picture in his mind what it's supposed to look like,
Speaker 7: what he wants it to look like.
Speaker 8: I think at the.
Speaker 7: Heart, the current system, in his view, does not serve
Speaker 7: America well. And you can debate whether that's true or not,
Speaker 7: but in his mind it doesn't serve America well, and
Speaker 7: so he wants to leave something that's better, and I
Speaker 7: think it's probably through a negotiated deal.
Speaker 8: How you get there is another matter.
Speaker 1: So when it comes to China, what do you think
Speaker 1: this could look like? I was talking to people yesterday Washington,
Speaker 1: DC who are convinced that Trump wants a grand bargain
Speaker 1: includes things like TikTok and other levers they can pull.
Speaker 1: What do you think that deal could potentially look like?
Speaker 4: Yeah?
Speaker 7: I think I think I'm not sure what the deal
Speaker 7: looks like, cause I think it's a lot more complicated
Speaker 7: than people think it is. So, look, China takes a
Speaker 7: much longer view than we do. They think they can
Speaker 7: outlast us, that the pain threshold, that kind of Jonathan
Speaker 7: was just alluding to that it'll be so great in
Speaker 7: the United States that the US is gonna have to
Speaker 7: capitulate at some point. So they're gonna they're gonna wait
Speaker 7: on this. The other is, you know, there's been this
Speaker 7: view in the United States that China has more to
Speaker 7: lose from this than we do. And if you look
Speaker 7: at the raw numbers, yes that that that's true. You know,
Speaker 7: they export more here than goes the other way. At
Speaker 7: the same time, the US exports to uh Chinese exports
Speaker 7: to the United States are about less than three percent
Speaker 7: than the overall Chinese GDP. That's a big number, but
Speaker 7: it's a manageable number. And if you take that longer view,
Speaker 7: you can strut to restructure economy and find other trading
Speaker 7: partners stiff to at least partially fill the void.
Speaker 8: So I think this is going to do. I think
Speaker 8: China is going to take much longer than people expected to.
Speaker 5: I want to build on John's line of questioning where
Speaker 5: he said, right now, doesn't seem like the polls is
Speaker 5: really a check on the president, despite what a lot
Speaker 5: of people had expected. Doesn't seem what the stock market
Speaker 5: is a check on this president's policies. What is a
Speaker 5: check potentially on what he decides to.
Speaker 6: Do and not just what he decides to do, but
Speaker 6: how he does it.
Speaker 7: I do think I agree the stock market is not
Speaker 7: a check. I do think what we've seen is that
Speaker 7: the bond markets and the broader financial markets are a check.
Speaker 7: And I think you have the Secretary of the Treasury
Speaker 7: talking to the president and warning him about economic repercussions
Speaker 7: if he keeps going down in certain lines on trade policy.
Speaker 7: I think that's why we got the pause. So there
Speaker 7: are some checks. Again, we probably have mispriced all of this.
Speaker 2: Right.
Speaker 7: The checks are still there, there are just much different levels.
Speaker 7: What that level is I don't. We don't know until
Speaker 7: we know. It's impossible to say. But his poll numbers
Speaker 7: have deteriorated over the last couple of weeks.
Speaker 8: The honeymoon seems to be over.
Speaker 7: Very interestingly enough, this is lining up pretty much with
Speaker 7: the same timing that President Biden saw his honeymoon end
Speaker 7: when he got when we had the problems with Afghanistan
Speaker 7: and a few other issues in April of twenty twenty one.
Speaker 8: Maybe there is some level at which.
Speaker 7: You know, further poll deterioration causes the White House to
Speaker 7: rethink this. And you know, because the president's not running again,
Speaker 7: he's a little bit immune to polls.
Speaker 8: But at some point does.
Speaker 7: The vice president ste been because obviously the vice president
Speaker 7: is going.
Speaker 8: To want to succeed.
Speaker 7: And how much sway does jd Vance have with the president,
Speaker 7: because clearly he is looking towards twenty twenty eight.
Speaker 8: Donald Trump's not He's.
Speaker 2: Got to say that's a huge question.
Speaker 4: Broan.
Speaker 2: It's got to say you've said thank you for having
Speaker 2: got in that have stayful. Let's stick with tech. Apple
Speaker 2: reporting results after the closing Now today Dan ives of
Speaker 2: wet Bush, writing, we remain bullish on the long term
Speaker 2: opportunity for Apple's flagship ecosystem.
Speaker 8: Investors need to look.
Speaker 2: Past the next three months and assumed China tariff negotiations
Speaker 2: take a positive turn, Dan optimistic as always joined us
Speaker 2: Now for more, Dan, welcome to the program sir, Let's
Speaker 2: go straight to it with Apple. How are you going
Speaker 2: to draw a distinction later on this afternoon between a
Speaker 2: front loading people rush into the stores before the tariffs
Speaker 2: and decent, sustainable underlying demand.
Speaker 9: Yeah, I'm actually less focused in the quarter as you
Speaker 9: talk about in terms of pour forward or front loading.
Speaker 9: Really about what Cook talks about in terms of parrots,
Speaker 9: like are they going to stay on schedule iphon seventeen launch?
Speaker 9: You know how they're going to sort of scenario analysis
Speaker 9: in terms of when they're seeing in China that we
Speaker 9: need to hear from Trump administration? Whose are the keys?
Speaker 9: And I actually numbers take a back seat to Cook's
Speaker 9: commentary about that.
Speaker 2: So don let's talk about the guidance then, what kind
Speaker 2: of scenarios they could offer, and what you think of
Speaker 2: the approach so far from corporate Americas, Because we've seen
Speaker 2: a range of things down. Some people have just pulled guidance,
Speaker 2: haven't offered any other people of some people have offered
Speaker 2: multiple scenarios. What would you appreciate What would you prefer
Speaker 2: to see this afternoon.
Speaker 9: I prefer no guidance because I need you give guidance.
Speaker 9: Jactually put your back ends the wall. I want they
Speaker 9: could give some sort of scenarios, but it comes down
Speaker 9: to Junes of Mulligan. It's a passaway border. I think
Speaker 9: the really focus is, you know, do you launch in
Speaker 9: terms of September. I've burned seventeen and give some scenarios
Speaker 9: and ranges for investors to understand what this could do. Look,
Speaker 9: we've already factored ten percent cuts to numbers, worst case
Speaker 9: twelve to fifteen percent, best case two to five percent.
Speaker 9: That's how we're going into tonight.
Speaker 5: You know, John Ray's just a really interesting point earlier
Speaker 5: Dan about how much forward buying there was over the
Speaker 5: past couple of months and frankly over the last couple
Speaker 5: of weeks to get ahead of any potential disruptions in
Speaker 5: shipments from China. Are you expecting to get any guidance
Speaker 5: about the pull forward effects and maybe that we could
Speaker 5: even see much better than expected numbers that will only
Speaker 5: be made up in maybe declines later on.
Speaker 9: Yeah, Look, there will be pulled forward, and again I
Speaker 9: think number draps are going to be burned strong, and
Speaker 9: I think they could quantify some of that, But that's
Speaker 9: sort of that sort of breadcrumbs. I think the real
Speaker 9: focus in next few quarters, over the next six to
Speaker 9: nine months, how they're going to navigate these in terms
Speaker 9: of maybe even talking out some supply shame plans the
Speaker 9: India new scenario. I think that I think any commentary
Speaker 9: like that would be very important to understand from Cook
Speaker 9: to kind of put a flash light in a dark
Speaker 9: tunnel when it comes to TARFF scenarios.
Speaker 5: We're hearing a lot of commentary about how maybe Meta
Speaker 5: and Microsoft have been somewhat immune. We're going to be
Speaker 5: hearing more potentially from Apple and Amazon. We got this
Speaker 5: reporting overnight from the Wallstreet Journal that they were thinking
Speaker 5: among some of the height at Tesla at some of
Speaker 5: the height of the of the carnage and some of
Speaker 5: the boycotts, that they are looking at potentially getting another
Speaker 5: CEO to replace Elon Musk.
Speaker 6: What do you make of that?
Speaker 10: Look?
Speaker 9: We talked about it on your show right a lot.
Speaker 9: I mean the point is, regardless the board denies it,
Speaker 9: and the scenario is this was the moment of truth.
Speaker 9: The board had to do something, whether it's a warning
Speaker 9: shot or whatever it may be, it must kind to
Speaker 9: choose CEO of Tesser Dude, and we thought that conference
Speaker 9: call is probably the best conference clubsee must do maybe
Speaker 9: ever or Leased in the last four or five years
Speaker 9: so important because the brand damage and what was ultimately happening.
Speaker 8: Clock struck midnight.
Speaker 9: So regardless of the semantics and what actually happened, what
Speaker 9: did happen, the end result is a huge positive. Must
Speaker 9: back in the driver's seat SEEO of tests. And I
Speaker 9: continue to think like his deeds the White House are
Speaker 9: essentially do well.
Speaker 1: Dan, They're not in the sense that he was at
Speaker 1: the cabinet meeting yesterday wearing not just one but two
Speaker 1: make America Great hat stacked on top of each other.
Speaker 1: Even though he is more focused maybe on Tesla now
Speaker 1: than he was in the beginning of this administration, were
Speaker 1: very focused on Doje. Can that brand destruction still carry through?
Speaker 9: Yeah, look me and you've talked about that a lot,
Speaker 9: and I'd be surprised of these other cabinet meetings. I mean,
Speaker 9: just given I think the pressure for him to short
Speaker 9: detach himself. But we've to have brand damage.
Speaker 8: You got to contain it.
Speaker 9: You have a massive error of growth ahead. Autonomous robotics
Speaker 9: turning things around in China, especially bid in terms of
Speaker 9: rising here, in terms of from a share perspective, leaders lead.
Speaker 9: That's what Musk has to do now, and I just
Speaker 9: think that was the move that he started to take
Speaker 9: on last week's call, and I think that's what we
Speaker 9: expect to see from Must going forward. It's also why
Speaker 9: the stocks up because ultimately now you have the biggest
Speaker 9: asset of Pessa fact, regardless of the drama that went
Speaker 9: through between the board and Musk or whatever did or
Speaker 9: didn't happen.
Speaker 2: And then let's finish on the biggest challenge to them
Speaker 2: right now, which I think could possibly be a tie
Speaker 2: up between Weimo and Toyota. We're talking about the best
Speaker 2: setting comprand on the planet, two of the best setting
Speaker 2: models out of the top three in the world in
Speaker 2: the last twelve months getting together with Weimo, that's delivering
Speaker 2: two hundred and two hundred thousand, two hundred and fifty
Speaker 2: thousand paid trips every single week. Why isn't that a
Speaker 2: threat to Tesla.
Speaker 9: I personally think that's not as big a throw as
Speaker 9: maybe some park right well, Wimber two hundred forty thousand
Speaker 9: dollars cards and four cities that obviously will expand they
Speaker 9: had the lead in terms of coming out of the gate.
Speaker 9: I think when it comes to Scire cabs and house
Speaker 9: iding on Parliament. There the scaling scope. They're really going
Speaker 9: to own that market. So you're going to see more
Speaker 9: and more partnership like this. But it's not like I
Speaker 9: view this partnership as something that changes my thesis on
Speaker 9: Tessa in terms of autonomous but it also speaks more
Speaker 9: and more must need to be leading. Keessla not sitting
Speaker 9: there as the said, wearing you know, two or three
Speaker 9: hats and the cabinet meaning.
Speaker 2: I'm guessing you're at the airport, Dan travel safely. It's
Speaker 2: good to see us, sir. Thank you guys a making
Speaker 2: sign for us. Then I have a web pish there
Speaker 2: with this around the table now being Lincoln of being
Speaker 2: my capital market Seeco.
Speaker 10: Monic morning, thanks for having me on.
Speaker 2: I'm going to repeat that question for you. The Treasury
Speaker 2: Secretary scout person said, because the two year yield is
Speaker 2: trading below FED funds, it's evidence that they are too
Speaker 2: tight and they should cut interest rates. What's your response
Speaker 2: to that.
Speaker 10: It's suggesting that the market anticipates it. Over the course
Speaker 10: of the next twenty four months, effective FED funds is
Speaker 10: going to be lower than it is. That doesn't mean
Speaker 10: that now is the time to cut that just means
Speaker 10: that the market is telling us that they FED will
Speaker 10: resume normalization at one point.
Speaker 5: Does it concern you that there is so much discussion
Speaker 5: around FED policy from administration officials.
Speaker 10: Well, we came into this knowing that there was going
Speaker 10: to be some political pressure put on Powell. There's been
Speaker 10: conversations coming out of the White House about potentially removing him.
Speaker 10: I don't think that that's really in the cards order.
Speaker 10: I think that's frankly possible. It's not surprising, however, that
Speaker 10: we have started to see some negotiations again with potential
Speaker 10: replacements for Powell coming into whether it's fee of the media,
Speaker 10: whether it's conversations that have been had at the White House.
Speaker 10: So I'm not really surprised, but somewhat apprehensive of the
Speaker 10: uncertainty created by this political pressure.
Speaker 6: Well that's what I was going to say on the margins.
Speaker 5: Is this a fact not just FED policy, but also
Speaker 5: how the market responds to it. If there is this
Speaker 5: feeling that there will be somebody else coming in, that
Speaker 5: there could be a shadow FED, that there is pressure
Speaker 5: increasing job owning, and frankly that FED fit officials may
Speaker 5: feel like any decision or words that they say will
Speaker 5: be interpreted in a political way, both in the market
Speaker 5: and in the White House.
Speaker 10: I don't think it's really a typical for the administration
Speaker 10: to be pushing back against any given FED or any
Speaker 10: head of the FED. But what I think it's what's
Speaker 10: so unique in this cycle is how vocal and how
Speaker 10: real time it has become. Typically, you would expect any
Speaker 10: sitting president to want the easiest monetary policy possible. But
Speaker 10: Powell's objectives are for the long term stability and health
Speaker 10: of the US economy, which involves price stability, and that's
Speaker 10: the That's a battle he's fighting at the moment.
Speaker 1: Because it's so vocalsure and the trum FED chair how
Speaker 1: to come out and say this is an appropriate a
Speaker 1: sense saying by law he's allowed to stay in his job.
Speaker 1: Does it make it harder for them to cut rates
Speaker 1: if they had to extend It just looks like they're
Speaker 1: placating the President of the United States.
Speaker 10: Well, I think something that we've learned over the course
Speaker 10: of the last several weeks is yes, there's a power put,
Speaker 10: but there's also a Trump put, and the Trump put
Speaker 10: is struck higher than in the power put. Powell doesn't
Speaker 10: want to encourage and reinforce behavior in the White House
Speaker 10: that isn't necessarily going to be good for the long
Speaker 10: term health of the economy. And so to your point,
Speaker 10: I think that when Powell deems it time to resume normalization,
Speaker 10: that that's when it happens, and he won't give into
Speaker 10: the political pressure.
Speaker 1: Following the Treasury Secretary's comments about the two year rate
Speaker 1: below the Fed funds rate, Neil dot To put out
Speaker 1: notes and wage and salary growth is running below the
Speaker 1: level of Fed funds rate as well, meaning it's already
Speaker 1: too tight. What do you make of that argument?
Speaker 10: Well, I will argue that the bulk of what has
Speaker 10: occurred over the last six or eight weeks has been
Speaker 10: really a uncertainty inducing event, and it follows intuitively that
Speaker 10: as some of the backward looking data could suggest that
Speaker 10: it's time to cut rates, that the market is focused
Speaker 10: on those aspects of it. There's also aspects of the
Speaker 10: data that suggests that the Fed should continue to remain
Speaker 10: on hold until September or later, which is actually my
Speaker 10: assumption at.
Speaker 2: This point is ready to call moments. Take the numbers
Speaker 2: from Visa. We mentioned this just yesterday. We've not seen
Speaker 2: any signs of overall consumer spending weakening. That's from the
Speaker 2: CEO from McDonald's right now, this is what they're saying.
Speaker 2: They're cautious about the overall half of the consumer. They're
Speaker 2: seeing pressure hitting the middle income consumer in America and elsewhere.
Speaker 2: Picky poison.
Speaker 4: Right now.
Speaker 5: It's difficult, and that's the reason why cruise liners are up.
Speaker 5: But if you look at one cruise liner, it's up,
Speaker 5: but maybe not the other. And then you have people saying, well,
Speaker 5: sometimes companies are just trying to use the circumstances as
Speaker 5: an excuse to talk about weakness.
Speaker 6: That might have already been president in their business models.
Speaker 5: It is difficult to understand whether this consumer is going
Speaker 5: to be tolerant of price increases or not, which is
Speaker 5: the reason why you might see some testing by companies
Speaker 5: to see, let's get a sense can they absorb this
Speaker 5: and can we pass it along.
Speaker 2: I don't think it gets any easier from here. You're
Speaker 2: going to see way more distortions in the data for weeks,
Speaker 2: maybe even months to come in. It's wonderful to catch
Speaker 2: up with this appreciated in lind There of Bemo Capital Markets.
Speaker 2: This is the Bloomberg Sevenance podcast bringing you the best
Speaker 2: in markets, economics, and politics. You can watch the show
Speaker 2: live on Bloomberg TV weekday mornings from six am to
Speaker 2: nine am Eastern. Subscribe to the podcast on Apple, Spotify,
Speaker 2: or anywhere else you listen, and as always, on the
Speaker 2: Bloomberg Terminal and the Bloomberg Business app.